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Lumber Shortage Fears Prompt Buying, Price Increases

10/23/2013

 
Source: Woodworking Network
With the fear of lumber shortages as strong as the outlook for 2014, lumber sales should hold steady through year-end even as North American manufacturing winds down for the winter. Global consumer confidence will also get a boost as the U.S. debt default is averted…or at least kicked down the road.
Improved weather conditions have increased hardwood lumber production and most mills now have enough logs to operate a normal week, though a lack of loggers will keep production lagging demand through year-end.

Chinese buying has shown little resistance to rising prices since August, and won’t through mid-December. The only push-back we’re hearing is on Poplar, but even Poplar prices will hold firm or bump up a bit. Too many Asian distributors and manufacturers let supplies dwindle this summer in anticipation of price drops that never came.

Aggressive domestic buying will also contribute to tight supplies and rising prices over the next two months. Concentration yards will try to bulk up inventories to serve strong domestic and export demand in 2014.

Flooring plants will look to lock in extra inventory heading into winter, as they normally do, but with the added urgency of unusually strong fall flooring sales. Even some cabinet plants will buy extra with an eye towards future needs.
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